Militia violence fails to deter Iraqi activists eyeing elections and a better life


Sinan Mahmoud
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Young Iraqis campaigning for better services and jobs say assassinations by militants linked to Iran-backed political parties do not frighten them. At least 500 activists have been killed since a nationwide protest movement began in 2019.

Despite the constant threat of violence, some are preparing for parliamentary elections scheduled for October 10.

Intimidation is nothing new for Salah Al Suweidi, who is running as an independent in the elections for the 328-seat parliament. As an activist in the pro-reform protests that broke out in October 2019, Mr Al Suweidi escaped two assassination attempts and endured a home raid.

“We are used to targeting and killing,” Mr Al Suweidi told The National. “The Iraqi people have reached the point where death and life are equal, so we have to rise up and change our reality."

Independent candidates say the road ahead for them is tough, but they see hope in the country's new electoral law and an eagerness among the public to undermine the influence of political parties.

Salah Al Suweidi meeting people from his constituency.
Salah Al Suweidi meeting people from his constituency.

Iraq’s current political elite took power after the 2003 US-led invasion toppled the Saddam Hussein regime.

Prime Minister Mustafa Al Kadhimi, who took over in May last year, promised to ensure free and fair elections. But many Iraqis say that is a distant dre

am, given the rising tide of assassinations of activists and the presence of rogue militias.

“With the presence of weapons that are outside government control and political money, it will be hard to have fair elections,” said Mr Al Suweidi, who is eyeing one of 69 seats allocated for representatives in Baghdad, the capital and one of Iraq's 18 provinces.

Still, it is vital to have independent candidates in the next parliament, to start the long process for change, said the lecturer at Baghdad’s University of Al Mustansiriyah.

“If at least three independent candidates from each province reach parliament, I would consider it a success – a good achievement,” he said.

Mr Al Suweidi believes that Iraq’s problems “can’t be solved overnight, but we will need a long-term strategy that covers two or three terms to win”.

Protests that affected much of central and southern Iraq forced the previous government to resign.

When he took office, Mr Al Kadhimi initially set June 6 this year to hold early elections, but then postponed it to October 10 owing to technical requirements.

Bowing to protesters' demands, Iraq’s parliament endorsed a new law that paves the way for independent candidates to the legislative body, a move hailed as a success in a multiparty system.

Unlike previous elections, Iraq will be divided into several constituencies instead of being treated as one constituency. The former system allowed political parties to take seats depending on their share of the national vote.

The new law does not allow the political parties to run unified lists, something that helped them to sweep up parliamentary seats in a specific province. Instead, the seats will go to whoever gets the most votes in the electoral districts.

That has encouraged Rajab Al Mudhafar, an activist and resident of the southern province of Basra, to run again after failing to win a seat in the 2018 election.

“There is a golden opportunity now for independent candidates and voters who seek to change the domination of the political parties,” Mr Al Mudhafar, 45, told The National.

In previous elections, the senior engineer at the Ministry of Electricity ran as an independent candidate on the list of a newly formed political entity, as stipulated under the old electoral law.

In 2018, 6,900 people voted for him but he could not reach parliament because of the old formula for calculating votes within the list and seat distribution.

“Chances are higher for independent candidates in coming elections than previous ones," he said. "Now, the winner is the one who gets the most votes.”

Basra is divided into six districts with a total of 25 seats. Mr Al Mudhafar is running in a district in northern Basra where 33 candidates – 23 men and 10 women, are vying for four seats, one of which is reserved for women.

A total of 3,523 candidates have submitted their nominations to the Independent Electoral High Commission, spokeswoman Jumana Al Ghalaie told The National.

The number of independents are not yet known, and the number of eligible candidates could be lower after a vetting process that is expected to be completed next month, Ms Al Ghalaie said.

Of about 25 million eligible voters, about 22 million have updated their information to receive new biometric voting cards or update existing ones, she said.

An early election was one of the main demands of the protest movement hoping to overhaul of Iraq's political system. But the government’s failure to protect activists from assassination and intimidation has led to calls for the polls to be delayed, at least until they can be held securely.

Baghdad resident Bayada Ibrahim Ali, 38, said she will be protected by siblings as she vies for a place in parliament.

“My family has encouraged me to nominate myself and they will protect me,” Ms Ali said.

In 2019, she took to the streets to demand improved government services.

“I will fight for a liberal state that respects the citizen’s rights, mainly women, children and the elderly, and offers better services to all,” she said.

She said that the government and IHEC will not be able to guarantee free and transparent elections in this atmosphere, citing the 2018 elections that were mired in allegations of voter fraud and corruption.

During an event hosted by a local think tank last week, Iraqi President Barham Salih assured the public that “repeating what happened in the last elections would be an ominous omen we can’t accept”.

However, Mr Salih acknowledged that the mission will not be an easy one.

“We are facing a challenge in convincing the people with practical procedures,” he said. The IHEC was "working hard”, he said, on measures to protect the electoral process and that there would be international monitors.

“We hope that we will take real and practical procedures by the time of the elections that can assure the people that we are serious,” he said.

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

What sanctions would be reimposed?

Under ‘snapback’, measures imposed on Iran by the UN Security Council in six resolutions would be restored, including:

  • An arms embargo
  • A ban on uranium enrichment and reprocessing
  • A ban on launches and other activities with ballistic missiles capable of delivering nuclear weapons, as well as ballistic missile technology transfer and technical assistance
  • A targeted global asset freeze and travel ban on Iranian individuals and entities
  • Authorisation for countries to inspect Iran Air Cargo and Islamic Republic of Iran Shipping Lines cargoes for banned goods
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1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

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Updated: July 01, 2021, 12:05 PM